GBP shows signs of recovery vs USD

Daily Currency Update

GBPUSD slightly recovered on Wednesday, trading back above 1.3150. The upside for GBPUSD came about from FX markets taking a more positive view of current geopolitical events, which led to investors selling the US dollar. Traditionally investors tend to move towards safe haven currencies in times of uncertainty, such as the Russia-Ukraine war.

The Bank of England Governor, Andrew Bailey, spoke yesterday and commented that the guidance around potential interest rate hikes this month has been more cautious to accommodate for the higher level of economic uncertainty at the moment. Deputy Governor, Broadbent, then spoke and backed up these comments, going on to say that the Russia-Ukraine crisis is going to have an impact on the UK outlook.